Next UK Election: Who will have power?

If you think it will be a new political party, you will probably change your view after reading Princes of the Yen (see the last 2 Blogs). Author Richard Werner shows that it is most importantly the creation of money by a country’s central bank that drives an economy. Over the past 50 years in Japan it was essentially the power of 6 central bankers in succession which caused the economy to rise or fall. So if the Tories win next year in the UK do they think they will have their foot on the throttle to bring lift-off to the economy? Will they instruct the central bankers as they create credit to ensure that it is channeled only to productive enterprises and not land speculation and other financial bubbles?

We need an open debate about who ultimately has responsibility for a sound economic system. Otherwise, expect a long drawn-out period of pain and then a stumbling into the bad old ways of banks encouraging the economy largely based on property speculation - easy money when the next house price bubble starts. Sir David Walker has just published his recommendations for sorting out Britain’s banks (draft Walker Report 16 July 2009). He speaks of responsibilities / risk awareness / Principles of Stewardship and other admirable ideals. But it does not seem to have gone to the heart of the problem: who controls credit creation?

Who feeds the beast that needs all this new control? Who chooses whether the new money goes into bubble investment or productive investment? These things need to be discussed and clarified for the UK economy itself.

Who controls the controllers? Everything needs making clear and as openly as possible. The lives of us all are affected too much by the actions of a few central bankers and the system of banking that they oversee. It needs democratic oversight.

Ponder this: In the midst of a deteriorating world economic scene, only this week bankers Goldman Sachs have revealed record profits and huge staff bonuses: News link. But they are only doing what we allow them to do. The bad old economic system is still alive and thriving for some and it needs a drastic makeover.

For an interview with Richard Werner on YouTube click here. He is an top flight economist who has bothered to find out economic secrets that very few of us would have imagined existed. He trounces conventional economic thought on the use of interest rates for economic regulation. He understands what should happen at the highest levels of any national economy for the well-being of all citizens.